Since the 1920's, it has been known that the human auditory system treats direct and indirect sound differently in binaural perception. The time difference and delay as well as level difference of direct sound reaching each ear (also known as, interaural time difference and interaural level difference) provide cues that allow the listener to perceive distance and direction from a sound source. Audio typically also contains indirect sound created from repeated reflection and diffraction of sound within a space, which causes diffusion and uniform distribution of sound energy. For example, a diffuse sound field is typical of a gymnasium, swimming pool and interior spaces with many reflecting surfaces and low sound absorption, and also is typical of outdoor locations with sound coming from many directions (such as the canyon effect of an urban street lined with high-rise buildings).
When audio is recorded, both direct and indirect sound typically is captured in the recording. When played back on a conventional loudspeaker system, the hardware makes no attempt to distinguish the direct and indirect sound in the recording. With a very few exceptions, loudspeakers have had fixed ratios of direct-to-indirect radiation that depend on both specific room acoustics and the loudspeaker design. This can create a false perception of distance and direction for the indirect sound played back from a loudspeaker, and conversely fails to provide accurate perceptual cues for direct sound. The conventional loudspeaker system therefore fails to provide a perceptually accurate reproduction of the original audio.